Medicare Supplement
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Medicare is a Federal Health Insurance program for people 65 years of age or older, people under the age of 65 with certain disabilities, and for people of any age with end-stage renewal disease (ESRD). There are several parts to Medicare:
- Medicare Part A (Hospital Insurance)
- This helps cover inpatient care in a hospital
- It also helps cover skilled nursing facilities, hospice, and home health care.
- Medicare Part B (Medical Insurance)
- Helps cover doctor services, hospital outpatient care and home health care
- It also helps cover many preventative services
- Medicare Part D
- This is a prescription drug option run by Medicare approved prIvate insurance companies.
- This helps cover the cost of prescription drugs.
A Medicare Supplement plan, also referred to as a Medigap Policy, is a private health insurance that is designed to cover Original Medicare. This means that it helps pay some, if not all (that depends on the plan you choose) of the health care costs (“gaps”) that Original Medicare doesn’t cover (such as co-payments, co-insurance, and deductibles).
Today we have eleven (11) standardized Medicare Supplement Plans available in the market. These plans are identified by Medicare Supplement Plans A through N. While not all insurance carriers offer all 11 plans, the plans contain the same benefits regardless of carrier. The difference between the carriers is the cost.
The difference in cost for Medicare Supplements is usually based on how the carrier sets their rates. Do they us “banded” rates or “Age/Sex Distinct” rates?
- Banded Rates – Banded rates usually have no distinction in the rates for make and female. Usually all applicants age 65-69 get one rate, ages 70-74 a higher rate, etc. Tobacco usage is usually not considered. Rates are based on the zip code in which you live.
- Age/Sex Distinct Rates – The rates for females are usually lower than the male rates. Also, the age band is usually yearly (Ex: age 65, 6,, 67, etc. has a different rate) Therefore, depending on the age when you apply, determines your rate. Also, tobacco usage is usually considered under this rate structure. The difference can be upwards of $20.00 or more per month for those that smoke or use tobacco products.
You have certain Guaranteed Issue Rights in purchasing a Medicare Supplement policy. It is important for you to understand your “Open Enrollment” rights when purchasing a plan.
- Open Enrollment Period – is a one time only, 6 month period where Federal law allows you to purchase any Medicare Supplement policy from any insurance carriers that sells them in your state. This open enrollment period starts the first of the month in which you are covered by Medicare Part B and you are age 65 or older. During this period, you cannot be denied coverage or charged more premium due to past or present health conditions.
In addition, there are other instances where your Guaranteed Issue Rights apply:
- If you have Original Medicare and you are leaving an employer or coming off of COBRA (after age 65) and have had coverage, you may apply for Medicare Supplement Plans A, B, C, F, K, or L that are sold in your state under the same guidelines as open enrollment.
- If you currently have a Medicare Advantage plan and your plan is leaving Medicare or stops giving care in your area, or you move out of the plan service area, you can apply for a Medicare Supplement Plan A, B, C, F, K, or L that is sold in your state.
You can find additional information on Original Medicare at http://www.medicare.gov.
Medicare Part D Plans
When purchasing a Medicare Supplement Plan you will also need to purchase a Part D Prescription Drug Plan. The easiest way to find a Part D plan in your area is to go to http://www.medicare.gov and click on “Part D Drugs”. You will be asked to complete some basic information, enter your prescription drugs you are currently taking and a list of plans available in your area will be shown.
As part of our service to you, we will be glad to assist you with your questions and concerns regarding Medicare. Just click Contact Us above or give us a call to discuss your specific situation and questions.
To further assist you, below are several links which you may find helpful:
